What is small business insurance?
Small business insurance, also often known as commercial insurance, is designed to protect a businesses’ assets, resources, and income. Depending on the nature of your enterprise, this could mean anything from coverage of equipment, property, expenses, and liability associated with your goods and services. One of the most conventional types of business insurance is known as a Business Owners Policy (BOP). A BOP is an insurance portfolio that includes a series of insurance policies personalized to the operational needs of your company. Further types of coverage can be added to your BOP as necessary according to the unique risks associated with your business.Subject to the coverage you choose, a business owners policy helps to safeguard your business from property damages such as fires, storms, flooding and also financial loss due to being unable to operate.
Common Types of Business Insurance
Public Liability Insurance
Public Liability Insurance is a common form of insurance policy that is useful if your business operates out of a physical site. Even though public liability insurance is optional for the most part, it is always highly recommended, and in some cases such as public events, is even compulsory.If you work out of a shop, a warehouse, a food truck or even your home, anywhere a third party could injure themselves, then public liability insurance is a must.
Professional Indemnity Insurance
Unlike public liability insurance where it protects you for accidents and hazards to the public caused by your workplace, professional indemnity insurance helps protect you against claims made against your goods or services.If you have an accounting business and you mismanaged a clients account which resulted in serious financial losses for the client, then you could find yourself in a professional indemnity situation.Professional indemnity insurance covers you in the odd occasion you make a mistake or provide poor service.
Commercial Property Insurance
If you own any form of commercial property, whether it’s a store, warehouse, or unit, regardless how big or small, then you need commercial property insurance.Commercial property insurance covers your place of business for several costly scenarios such as fires, vandalism, theft, loss of rent, building fixtures and fittings, and water damage, just to name a few. Considering how many things could go wrong when owning a commercial property, it really is a no-brainer to include a commercial property insurance policy in your BOP.
Business Interruption Insurance
As a business owner, no one has a better understanding of how a minor snag in your daily operations can often critically affect your bottom dollar. Especially in this highly competitive business world where time is money. No business is immune to these unexpected complications, so it’s always recommended that you have the added security of business interruption insurance.Business Interruption Insurance safeguards you for those insured situations that cause gaps in commercial productivity resulting in loss of profits. It helps to finance ongoing expenses and wages in the unfortunate event such as a fire, breakdown in machinery, storm damage or theft.It’s a policy designed to give you peace of mind so that when those inconvenient situations occur, you can focus on getting back on your feet without the added stress of losing money.
Management liability insurance is designed to protect managers or directors, officers, and even the company from alleged wrongful acts and mismanagement. While insurance schemes such as professional indemnity insurance covers you for claims against the activities or advice you provide, management liability covers you for mismanagement that occurs during the running of your business.Examples of when management liability insurance comes into play can be cases of unfair dismissal, breaches of Work, Health & Safety laws, statutory legislation, and sexual harassment allegations in the workplace. Having management liability protection in place can cover you from legal expenses, audit costs, fines and penalties and investigation expenses.
In an age where technological advancement has firmly established itself in every enterprise, the need for cyber liability insurance is now more important ever. Any business, small or large can be victim to a cyberattack when the company’s data or customer information are compromised via data breaches or theft, and as a result can seriously cripple a business. In fact, small businesses are generally more vulnerable to cybercrime because they don’t usually have the extensive security infrastructure of larger organisations making them a prime target for hackers.If your business is victim to cybercrime, chances are you won’t be covered under your standard business insurance. Cyber liability insurance can cover you for data loss and data recovery costs due to a cyber breach, network business interruption costs, theft and fraud, blackmail and extortion payouts and public relations expenses to help rebuild your company’s reputation.If your business stores data such as credit card details and personal customer information like medical records and contact details, then it’s highly recommended you look into having some form of cyber liability protection.
Why You Should Consider Small Business Insurance
Any business can be vulnerable to many forms of litigation, with each company susceptible to its own specific types of insurance needs. Having a customised Business Owners Policy that is designed to meet your business’ needs is one of the best things you can do to maintain a level of financial security that guarantees protection against all the ways liability claims can derail everything you’ve worked so hard for.Small businesses don’t often have the resources to navigate expensive legal battles, afford expensive payouts or recover from the loss of valuable information or assets, so we recommended that you speak with one of our knowledgeable insurance brokers to tailor a small business insurance package that’s perfect for you.